Are Extended Warranties Worth the Extra Cost?

While an extended warranty on your gadgets may sound like a good idea, remember stores wouldn't be pushing them so hard if they weren't making them money. And how do they make them money? Because very rarely does anyone actually collect on the warranty. The truth is, if a manufacturer doesn't stand behind their product and believe in their product without charging you for a warranty, you may want to look into buying a different product. Australian consumers are protected by extensive consumer laws, including guarantees and warranties apart from those offered by manufacturers.

Bear in mind the initial price and the life expectancy of your appliance. Often the cost of an extended warranty is more than the appliance will be worth while many appliances are out of date before the warranty ends, especially with technology. Read the fine print and make sure what you are paying for is what you want in the warranty and that you'll get your moneys worth if you need to use it.

Plus, don't underestimate your abilities. If something goes wrong, do the research and you'll be amazed what you can fix yourself or get repaired cheaply using the Repairs and Maintenance category in your Spending Plan. You should also have the replacement cost of the appliance built in to your Peace of Mind account so that when the time comes you'll be able to buy a new appliance for cash and have a great negotiating tool.